Acknowledgements
 
YBhg, Datuk Phang Ah Tong
Deputy Chief Executive Officer of MIDA
 
Puan Sharimaton Mat Salleh
Deputy Chief Executive Officer
Malaysia External Trade Development Corporation (MATRADE)
 
Dr. Juergen Schloesser
Chairman of PSDC Management Council
 
Mr Muhamed Ali Hajah Mydin
Chief Executive Officer
Penang Skill Development Centre (PSDC)
 
Distinguished guests
 
Members of the media
 
Ladies and gentlemen,
 
Good morning. I am happy to join all of you at the Northern Region Supply Chain Conference. I am also pleased to see the good turnout today. We are deeply encouraged by your interest in preparing for the future of manufacturing in Malaysia.
 
This conference today will be a good opportunity for all of us to network, share insights and exchange ideas, particularly on building stronger supply chains in the northern region. Regular interactions between both the public and private sectors are important for us to better understand your business needs for us to fine tune our policies and provide a more conducive business environment.
 
Ladies and Gentlemen,
 
Despite the global economic uncertainties, Malaysia’s economy continues to demonstrate its resilience. As measured by gross domestic product (GDP), our economy rose 5.6% in 2017's first quarter from a year earlier. With strong economic fundamentals, Malaysia is maintaining its status as an attractive investment destination. As one of the most diversified economies in the world, Malaysia offers ample areas for investors to venture into.
 
Our continuous drive and commitment to build a conducive environment for businesses to thrive has received recognition from many international institutions. In the Doing Business Report 2017 published by the World Bank, Malaysia was ranked 23rd worldwide for the ease of doing business, outranking even developed countries such as Switzerland, France and Japan.
 
The annual UNCTAD World Investment Report regularly ranks Malaysia among the most profitable and prospective economies – for example, 8th top prospective host economy among developing economies for the period 2015-2017 worldwide. The Baseline Profitability Index 2015 ranks Malaysia 6th Most Attractive Investment Destination in the World.
 
These rankings bear testament to the fact that the political, economic and regulatory reforms undertaken by Malaysia are delivering results and boosting the trust and confidence of foreign investors in choosing Malaysia as an ideal destination for their investments.
 
Ladies and Gentlemen,
 
Advanced technologies such as those in automation and digitisation are making breakthroughs in manufacturing processes, creating smart factories where man and machine can work together. Given the new wave of technological change that is sweeping across the global manufacturing sector or better known as the Fourth Industrial Revolution or Industry 4.0, it is timely for our industries to act quickly and steer towards this direction. The adoption of these technologies will open up opportunities for completely new and efficient business models in manufacturing, and lead to increased productivity and growth. We need to keep pace with these advances and seize the growing opportunities.
 
With more than 40 years’ of experience in the manufacturing sector since the establishment of globally renowned corporations here in the early 70s, Malaysia has a solid manufacturing base. For the past 20 years, this sector has embarked on robotic assembly lines, precision engineering and computer controlled processes. Industry players, particularly in the northern region, are well positioned to be at the heart of this transformation.
 
MITI and our agencies are embracing these opportunities and we want to see more companies adopting smart manufacturing processes and technologies that will lower costs and increase efficiency. We want to build a stronger and more comprehensive ecosystem, one that focuses on talent, skills and innovation.
 
We understand that it is not easy for a company to transition into this new era of advance manufacturing. Major shifts within an organisation’s internal structure and operating processes will be challenging, but the transformation is necessary. The reality is that by 2050, virtually all industries from banking to manufacturing will be integrating digitized automation and robotics. To stay competitive and relevant, industry players will need to invest in technology and innovation, and take on new manufacturing processes and practices. Staff up-skilling will also be essential to ensure that companies remain competitive.
 
Some examples of companies that have started moving towards Industry 4.0 in Malaysia are:
 
a.      Vitrox, a local company championing the growth of 3D intelligent vision inspection equipment incorporating elements of Machine-to-Machine communication.
b.      GE’s Asia Pacific Predictivity Centre, which provides monitoring and diagnostics services for GE’s installed fleet of turbomachinery for its customers throughout the world. It’s big data analysis and predictive analytics platforms assist industry players particularly in the oil and gas sector, to manage operational and capital efficiency.
c.      Jabil Circuit, which uses in-house developed IoT and partners with a leading player to jointly develop predictive analytics solutions to improve process capability, manufacturing quality, delivery performance while reducing repair and line stoppages.
d.      Other companies employing best practices with Industry 4.0 principles include First Solar, Delloyd, Inari, Infineon and B.Braun.
 
Ladies and Gentlemen,
 
The Government is aggressively undertaking various efforts to forward the development of smart manufacturing in Malaysia. This includes drafting a National Policy on Industry 4.0 that will be tabled to the Cabinet in the fourth quarter of 2017, establishing a National Industry 4.0 Taskforce to spearhead the government’s policy and strategy in this area, and conducting an industrial study focusing on Future of Manufacturing ‘Industry 3+2 sectors’ that is led by MIDA. 
 
In addressing productivity challenges and strengthen digitization, the Government has also launched the Malaysia Productivity Blueprint to pave the way in achieving the national labour productivity growth of 3.7% per annum by 2020. The National Internet-of-Things (IoT) Strategic Roadmap has also been launched with the expectation that the implementation of IoT would contributed USD2.3 billion to Malaysia’s GNI by 2020 and USD10.6 billion by 2025.
 
The government has also announced 2017 as Malaysia Digital Economy with USD40.5 million being allocated to implement programmes that includes developing the e-commerce ecosystem. Furthermore, Malaysia has embarked on the world’s first Digital Free Trade Zone to promote the growth of e-Commerce by providing a state-of-the-art platform for SMEs to conduct business and services. As you may be aware, 2017 is also the Year of the Internet Economy for Malaysia. This means that the digital economy is not just a component, but is a key catalyst of the real economy for the 21^st century.
 
As in any industry, technology may play a crucial role but the success of manufacturing also relies heavily on human capital. The government is looking seriously into talent management to ensure that our people have the necessary skills and competencies advance the economic transformation agenda. Malaysia forecasts the need for at least 20,000 data professionals and 2,000 data scientists by 2020.
 
MIDA, for example, has taken the initiative in developing an internship programme, namely ‘Malaysian Engineers – Made in Germany’. This initiative leverages on the high number of Malaysian students in Germany. It aims to enhance the employability of these under-graduates in careers related to advanced technology areas. To date, 18 German companies such as B.Braun, SGL Carbon, BMW, Infineon, Muehlbauer and Schmidt & Clemens have participated in the programme by offering annual internships for Malaysian students at their production facilities throughout Germany.
 
Other initiatives include:
a. Incentives packages for the production of robotics and factory automation equipment and related modules;
b. Automation Capital Allowance (ACA) for companies undertaking automation;
c. Incentive schemes to grow system integrators;
d. Soft Loan Scheme for Automation & Modernisation (SLSAM), and
e. Facilitation of the modernisation and upgrading of plants.
 
The Government is committed in exploring and initiating all possible ways to accelerate the adoption of Industry 4.0 in the current industrial landscape. In addition to the initiatives I have mentioned, MITI and MIDA have also carried out various programmes to engage with the business community. This includes the supplier conferences such as today’s event, the seminar on Smart Manufacturing and Automation Technology 2017 held in January this year, the seminar on Business Opportunities in Smart Manufacturing held in February in collaboration with the ASEAN-Korea Centre, and the Industry 4.0 Workshop on ‘Embracing the Future of Manufacturing’ which brought together major industry players, academia, research & technology institutions and Government ministries and agencies to design the Malaysian brand of Industry 4.0.
 
Ladies and Gentlemen,
 
Despite global challenges, Malaysia remains a strong resilient nation. We are committed to maintaining our competitiveness and sustaining our high levels of private investments. It is my hope that through this event, the business community here will be encouraged to adopt an open mindset, and take advantage of the opportunity to learn about new ideas and form good partnerships that can support your growth.
 
On that note, I wish everyone a productive day ahead and look forward to your active participation and feedback.
 
Thank you.
 
SOURCE : Malaysian Investment Development Authority (MIDA) 

FOR MORE INFORMATION, PLEASE CONTACT:
Name : En. Ahmad Tajudin Omar
Director, Domestic Investment Division, MIDA
Tel.: 03-2267 3627 
Email: tajudin@mida.gov.my 
 
--BERNAMA